PORTLAND, Ore. (KATU) — Portland is unlikely to change permitting rules to mirror at least one other Pacific Northwest city, despite some small business owners saying the rules force them to spend six figures on infrastructure projects outside their business.
However, the city commissioner in charge of the bureau in question said he directed employees to work with business owners to reduce development costs.
A KATU investigation last year first uncovered the requirements from the Portland Bureau of Transportation. The city – in some cases – forces small business owners to fix sidewalks and street corners outside their business in order to obtain a building permit.
Our investigation highlighted the city requirements placed on Matt Baysinger to open an axe-throwing business in Northwest Portland.
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The city initially told him he needed to redo a street corner outside his business to add new ADA corner ramps and a new storm drain, among other improvements. However, after our investigation, the city – through PBOT – waived the most expensive parts of the project.
“it’s hard to pinpoint [the savings] precisely, but I know for certain, I think we saved upwards of $200,000,” Baysinger told KATU.
Following the airing of that story, Kami Price reached out to KATU to tell hers. She wasn’t so lucky.
She and her business partner applied for a permit to renovate their new office in North Portland in early 2019. PBOT told them they needed to upgrade the corner outside her office – a project she said ended up costing over $100,000.
“Do you remember the very first time you got a bid for that corner, what you thought when you got the price,” KATU asked Price.
“I wanted to cry. It was way above what [PBOT] told us. It was going to be like several, several thousands more [than what PBOT said],” Price said.
RELATED | Portland put costly corner improvements on business owner despite upcoming state project
Our investigation found the city made her fix the corner despite a planned state project that would've covered the same work.
KATU showed Commissioner Mingus Mapps – the person in charge of PBOT – our investigation into Kami’s situation. He was not in charge of PBOT when the agency made Kami redo the street corner.
“I can very much understand why Kami is upset,” Mapps said. “I do not believe the same situation would happen today. We do operate within a regulatory environment that we have to comply with. At the same time, I've made it very clear to PBOT that we want to work with businesses and developers to build great infrastructure and grow small businesses.”
What are these projects, and when are they required?
The corner ramp projects are called frontage improvements, and the city requires them for building permits under two circ*mstances.
The first scenario is if you make "significant alterations" to a building – like Kami. City code defines that as, “changes to property that are 35 percent or greater than the assessed value of all improvements on the site.”
The second scenario is if your business increases daily trips to the building – basically if it brings more people to the property than its prior use. That’s what happened at Matt Baysinger’s business.
The city calculates the trip total using numbers from the Institute of Transportation Engineers. The calculation projects visitors based on the business's size and use.
The city recently approved an exception if the trip increase is 15% or less than the building’s prior use and under 250 daily trips. The new trip total must fit both exemptions, a PBOT spokesperson said, and would not have applied in Matt’s case.
“Do you think small businesses should have their project costs doubled by a city-required project,” KATU asked Mapps.
“Well, I'd hate to see that. Again, I think in most situations, if you file an appeal, we're going to be able to work with you in order to bring the cost of that project down,” Mapps said.
The city said the best way to fight the cost is through what's called the public works alternative review process. However, Matt Baysinger applied for an alternative project through that – largely citing the cost of the city’s requirements. PBOT denied his alternative proposal and only waived the most expensive parts of the project following the KATU investigation.
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Developers can formally appeal the final decision, but city code specifies that “a permit decision, requirement or condition may only be appealed if it is in writing and only on the grounds that it is inconsistent with or contrary to City Code, rules, standards, policy, or is a misapplication or misinterpretation, thereof.” In other words, cost is not a factor in the formal appeals process.
Mapps recommended reaching out to PBOT regardless.
“Certainly, I've sent the message to PBOT that we should work constructively with developers and constructively with property owners and constructively with business owners to make sure that their improvement projects both happen and at the same time, do common sense things like result in sidewalks outside your business,” Mapps said.
Comparing Portland to others
Our investigation found at least one other city does it differently. A spokesperson for the Seattle Department of Construction and Inspections confirmed it waives frontage improvement requirements if the project changes the use of a building – like Matt – or if it's an alteration to an existing building – like Kami.
“Do you think the city should review how it requires the frontage improvements,” KATU asked Mapps.
“Well, I think if you're building something and it's going to result in more foot traffic or more car traffic in front of your space, and there's not sufficient infrastructure for that, it's not unreasonable to have that expectation,” Mapps said.
Our specific question is whether the city should waive the requirement in scenarios where the city work doubles or greatly increases the costs of business construction in proportion to the cost of the original project that triggered the frontage requirements. Mapps would not commit to changing the rule.
PBOT said any change related to the definition of "significant alterations" would need to be amended by the city council.
Small business owners said there should be an exception for smaller projects under a certain threshold.
“I think the goal of what they're trying to accomplish makes sense. I think the way they're doing it is just making it really hard for businesses to be able to set up and open up shop,” Matt Baysinger said.
How often does it happen?
The city cannot definitively tell KATU how often small businesses – like these individual storefront businesses – are required to install corner ramps as a condition of a building permit without extensive research that would cost KATU hundreds or thousands of dollars in a formal records request.
However, the city estimated of the roughly 3,800 permit applications it processes per year, about 190 require some level of engineering expertise. Of those 190, a PBOT spokesperson said about half include construction of at least one corner ramp. The agency said the vast majority of the ramps are done by developers of apartment or condo buildings.
Understanding the cost of the projects
One big hang-up is the cost of these projects. Specifically, whether PBOT requires them based on a misunderstanding of how much they cost small business owners.
Architects and business owners told KATU that PBOT underestimates the cost of these ramp projects. For example, the city said corner ramp projects between $20,000 and $30,000. However, at least four developers told KATU the total price for private developers is over $100,000 with engineering, surveys, construction, and permitting fees.
"I've typically seen [corner ramp projects cost] probably about $70,000 on the low end and about $130,000 on the high end," architect Jeremy Miller told KATU. "I typically have seen the city's estimates to be a bit lower for that. I think the last one that I got was, they were just saying it should be $25,000, but the bids that we were getting from our contractors were significantly higher than that."
KATU asked Mapps: if PBOT really can do the corner for that cheaper cost, could PBOT simply charge business owners the cheaper cost and then the city take the project to a contractor on its own? Mapps said he’d look into that proposal.
PBOT already constructs hundreds of corner ramps annually as part of a legal settlement with an ADA group that requires citywide installation of 1,500 ramps per year from 2018 through 2030.
Other city leader supports review of the rules
Under the current form of government, Mapps – as the commissioner in charge of PBOT – is the only commissioner who can bring forward code changes that apply to PBOT. Under the new form of government in January, the mayor and other council members can make policy proposals.
Mapps' current colleague on the council who is also an opponent in this year’s mayoral race sees the code differently. Commissioner Carmen Rubio said she would support a top-down review of the rules if elected mayor this November.
“Our small businesses are the backbone of our local economy here, so anything that we can do to sort of free up that capacity so that they can focus on their work, focus on creating a thriving community, is ultimately what's best for Portland too,” Rubio said.
Rubio made changes around the city code tied to housing that she said should speed up development. She said other commissioners should do the same within bureaus under their control to right-size the requirements for small businesses.
“We’re trying to do everything we can, [pull] all the levers that we have at our disposal and the tools, to make sure that they're optimized so that we're sending a clear message out that we're open for business,” Rubio said.
